India’s machine tool industry is at cross roads. The reasons are many, and the primary ones are significant, some simple and some complex.
This has presented a situation for Machine Tool vendors, wherein it is nearly akin to a new market.
The most complex problem, facing the Machine Tool vendors is the inability of the component manufacturers to adapt to equally rapidly changing techniques used in machining which I refer to as New Paradigm of Machining.
Component manufacturer have realized this upcoming change for quite some time and businessmen who own these shops have also seen what is coming, but have not moved to the new techniques.
If you visit component manufacturers in Bengaluru, Hyderabad and Pune you will see that the shop floors are filled with various machines, machines are running and work is going on.
But, have they started with modern machining techniques? Not many, as it should be. This is because, they have delayed, and consequently it has become harder to catch up.
Machine Tool vendors, if they want to succeed have to take a leadership role and assist manufacturers to catch up.
Leadership role cannot be done as a social scheme but has to be dovetailed into the marketing effort of the individual machine tool vendor marketing strategy.
Let us take a step back and observe what is happening in the Industry
For the past many years the big target sector to target for component manufacturers has been Auto sector, but now big targets are many.
Every sector such sector is demanding complex parts to be manufactured and many component manufacturers are unable to service such orders. If you just visit component manufacturers around Bengaluru, and present a component which has a complex profile you will see several of them unwilling to manufacture such components.
For instance, Defence is set to taking a major role in the years to come. Indian Govt. has initiated a slew of measures to boost Defence Manufacturing in India.
The order potential of the weapon systems is expected to be in upwards of billions of dollars in the defence sector.
Component manufacturers are keen to leverage this opportunity but the problems they face are hindering them.
Incidentally, due to use extensive use of software in component design, and component complexity becoming more demanding than earlier, all this is requiring new machines and new engineering skills.
From the ecosystem side, business owners are finding it hard to get mechanical engineers in sufficient numbers with software skills required to create programs for machine tools of the new paradigm.
The Govt. of India is trying its best and is creating skill training center (s) and this is grossly inadequate given the demands to today’s industry.
Given all of the above it is obvious that Machine Tool Industry is at cross roads.
However, for the Machine Tool vendor the reality is simple – they have to sell.
They cannot wait for something to happen to start selling. No Reasons can be Given for not selling.
So, How does a Machine Tool company sell in an Industry riddled with problems?
It has to go back to the basics. The first principle of selling – Understand your Industry, and Understand your specific customer are to be revisited and thoroughly understood.
Most machine tool vendors while having an excellent understanding of the Industry, lack in one critical operational aspect. That is the “exact feedback from the operations”.
The principal reason many of the top grade machine tool companies are unable to create an impact in India is because the understanding of the customer and field issues is not understood and appreciated properly.
Let us see what really happens in the field.
Most machine tool companies approach a potential customer with a booklet of machine tools specifications and other details.
This is the first mistake.
Instead, what the machine tool marketer should be doing is have a short discussion with customer and list out the possible machines suitable and create an i-smart brochure of say under 5 offerings and visit the customer for a detailed discussion and presentation.
Suppose, the customer is not sure, you should be visiting the customer’s unit, study and suggest the right machine on your subsequent visits. This should factor in the existing machines in the shop floor.
If one were to do this exercise for say 100 customers and more, you will see that all these companies have a common need, a very urgent one.
Manufacturers (machine tool users) need a fast, one time load, 6 face machine, high tolerance, capable of turning and milling operations, minimum jigs or fixtures machine.
And, if you were to run an analytics software on the past components manufactured data, you will see that the number of components with sizes of around 200 mm will be maximum.
This should be the first target market for machine tool vendors. If they cater to different segment an appropriate plan has to be drawn accordingly.
The above gives a clear guideline for Machine Tool vendor to zero in on their prime offering and work from that point. Because, these machine will sell more numbers of this machine, vendors can price it aggressively and work from there.
Let us also look at does India have the indigenous capabilities to manufacture high grade machine tools with features mentioned above? Of course, Indian vendors can make machines with many features, they are not yet comparable with DMG, Doosan, and Traub to name a few.
Some of the international machine tool vendors have a strong presence in India. DMG Mori, with an intent to dominate the market, is investing in Indian Machine Tool companies and quietly taking over management control and aiming to grow and capture market share in this way.
Of course, Machine Tool Companies in India have a few good offerings but they lack in either stability or speed (RPM) or tolerance capabilities.
Now let us discuss strategic selling.
Using the following strategy execution, Machine Tool vendors, small and big, can sell their machines.
The first step is to Create a brand in the component manufacturers community.
Let us note here machine tool industry is a mature industry and all vendors have products which have many of the latest features. So, I can directly commence with marketing.
What are the existing Machine Tools brands in India today (2021).
|Brand Name||Brand Recall|
|DMG Mori [Japan]||Expensive, High Precision, Low Maintenance, Features, Sturdy|
|TRAUB [German]||Very Expensive, Specialized Machines, High Precision, Low Maintenance|
|ACE [India]||Affordable, Prompt Service with wide network|
|ASKAR [India]||Catering to Affordable Market|
Machine Tool vendors have to commoditize their machine tool offerings. Which means they have to become products with distinct attributes and simple to understand in the eyes of the customer or market.
Commoditization begins with creating a brand and the above table gives an idea of how Indian machine tool brands and their brand recall and how the market or customers perceive the particular machine tool brand.
A good place to begin would probably be the headline, a catchy one, like:-
No <your brand> Machine went idle in the last month!
Offer top class support, Invest in a development Centre, Link these Centre to Engineering Colleges, Conduct all Sales Presentations in a Standard Format, Target businesses who are in defence, railways and exports sector, offer exchange offers – tie up with pre-owned vendors and such.
Bundle offers, though quite challenging, can get Indian manufacturers buy the basic offering and the bundle offer if an attractive offer is given. Linking the performance of the first machine to the second machine is a good way to establish the confidence the vendor has on the first machine.
Component manufacturers need well trained programmers to work in their Engineering Departments. Access to a database of trained and certified programmers will be a great incentive to buyers, which is not too expensive to create and maintain. An online certification program will be a good step in brand building. This is similar to Microsoft creating an army of developers.
Machine Tool Selling in the Post Pandemic period
The pandemic has made corporate companies realize one thing. There is room for operating at a higher efficiency.
In terms of Time, Cost , and Outcomes.
Extensive use of online communication tools and collaborative tools has been forced upon us, and highly software savvy companies such as Microsoft, IFS and SAP and Manufacturing Companies which are at the other end of the spectrum have adapted to work from home in a big way. Companies in other verticals have also warmed up to this idea.
For machine tool vendors to succeed in the new online intense world, a country specific digital presence is a must.
Without a digital presence, commoditizing their offerings and building on year on year progress is next to impossible.
Let us see how many machine tool vendors have a strong India specific digital presence and buyer friendly.
|Company||India Specific Digital Presence||Observations from their respective website|
|Traub||Index Traub||Detailed, Comprehensive, No Sales Tunneling|
|DMG Mori||DMG Mori||Detailed, Comprehensive, No Sales Tunneling|
|ACE||ACE Micromatic||Very confusing, Not buyer friendly|
|Doosan||No India specific website|
|HAAS||No India specific website|
Whether we like it or not most corporate websites are sophisticated, comprehensive brochures. They are digital versions of their printed brochures.
All of them miss one simple point.
Sales Tunneling in their Websites
Before we get started on sales tunneling, let us discuss basic point which has to be thoroughly understood. That is,
Who are we designing the website for?
Shareholders? Employees? Vendors? Channel Partners? or Buyers?
Needless to say, all of the Machine Tool company websites are designed for the potential buyers.
But, are they?
Let us remember, website design is a creative job. So, each website design team will come out with their own design.
If Machine Tool decide that primarily there are 4 (six) categories of buyers, turning machines, milling machines, hybrid machines, and spms, then I would advice that these 4 categories of buyers are shown the best machine in the respective category on the home page, which we will assume is the landing page.
This serves two purposes. One, the undecided buyer is shown the best offer in the category and he will click through if he has a specific machine in his consideration.
It is very important for a website to lead the potential customer to a machine or machines which match his requirement.
The next three biggest points a buyer has on his mind when buying machine tools are:-
- Trained manpower on the particular machine
These three factors have to be addressed fully or partially on the website for creating a strong brand loyalty in the customer mind space.
One of things many Machine Tool vendors have missed on is a technical moderated discussion forum for users.
This will make buyers feel extremely secure in the knowledge that they have technical support from the vendor as well as a tech forum which is used by the user community.
Once you have the strategy set, the pawns placed, you are ready to start spending resources on reaching out to customers,
Development support is a must for complicated components. This will be a good attraction for potential buyers.
Funding support may also be required if the vendor can tie up with a finance company.
Whether we take cognizance of it or not, customers will interact directly with a vendor and also interact with the website.
Marketers have to factor in this when marketing a product to a customer.
Who are the Competitors?
|Competitors (Categories)||How to beat them?|
|Importers from China||Provide hassle free quick delivery.|
Offer free service for 1-2 yrs. Highlight network.
Offer at least 2 machines at a competitive price in a similar attribute bracket.
|Retrofitters||Highlight several problems of retrofitted machines.|
Usually operated by companies with no service network.
|Indian brand Low cost new machines||Highlight technical drawbacks, and how they can never catch up and how overall cost remains same or higher in low tech. brands.|
|Similar competing brands||Be creative, ingenious. Specific suggestions can be given if we know the brand for which the strategy has to be created.|
In summary, an exciting time for Machine Tool vendors.
Are you a component manufacturer? Or a machine tool manufacturer? or a Tech person? Then this article might be of use to you.